There are seventeen comments on the previous post so far, but none defending the market failure argument as the basis for a complete smoking ban. Anyone want to jump in?
David Barzelay, who does believe there’s a market failure here, raises a good question: If the market were working as well as I think it would, why aren’t there more bars catering to non-smokers? I can think of six possible explanations:
1) The question is flawed. There really are quite a few smokefree bars, but they tend to be the ones attached to restaurants rather than high profile freestanding bars. Smokefree DC’s incomplete list includes nearly 200 non-smoking, non-fast food restaurants. Given time and growing anti-smoking sentiment, more would follow. So would non-smoking freestanding bars.
2) Consumer preferences are weaker than self-reported. Passing a ban is costless for non-smoking consumers, so when asked about their opinion of the bill they are vociferously anti-smoking. When actually choosing a bar to patronize, however, they give smoking policies little weight. Introspective preferences unconstrained by any opportunity costs do not reflect the preferences on which people actually act.
3) Non-smoking preferences are vetoed by smoking friends. People go to bars in groups, some of whom smoke and some of whom do not. The smokers insist on a smoking establishment and the non-smokers must follow along. (This is another way of saying that non-smoking preferences are actually quite weak. When a group of friends goes out for dinner and some people want Thai while others want Italian, neither’s preferences always carry the day. If non-smokers felt strongly about it, they could convince their smoking friends to go to smokefree bars at least some of the time.)
4) An imminent ban deters entrepreneurship. Sensing a rising demand for smokefree bars, perhaps a new or existing establishment would have launched a PR-heavy campaign advertising itself as THE smokefree bar to go to in DC. With a city-wide ban in the works, why bother taking the risk? Their competitive advantage, and perhaps their customer base, would vanish in a puff of… um… something besides smoke.
5) Bar owners see an opportunity in going smokefree, but are afraid interested consumers won’t find out about it if they do. Information in the market for bars does not flow freely enough for non-smoking consumers to be able to act on their preferences.
6) The bar market is inherently static and closed to innovation. The city council is better at discovering consumer preferences than profit-driven entrepreneurs.
I find explanations 1 and 2 the most persuasive. 3 and 4 are plausible. 5 is possible, but given the number of newspaper columns devoted to DC nightlife, the support of a well-funded anti-smoking campaign eager to promote smokefree establishments, and word of mouth, I think it’s unlikely. 6 is ridiculous.